declining market but short marketing times

[George A Easton]

so i've now done two appraisals in a row where all my comps sold within 90 days, but i'm in a declining market. i've made market adjustments to all my sales and all my comments indicate this information. but when i run my error check software, it says that i'm not allowed to say that the market is declining AND that marketing time is less than 90 days. is that true? is that a no-no? usually when there's a red flag, it just warns me and reminds me to make a comment, but this flat out says that i need to change the checkbox...

 

[Rufus]

Did you check for cumulative days on market? Around here the MLS CMA will often show much shorter marketing time since many realtors start with unrealisticly high list prices and that listing expires or is withdrawn without selling. They then create a new listing with an appropriate list price and the property sells rather quickly.

 

[Marcia Langley]

George, your software can not override your judgement. You should ignore the warning.

I wonder if your software has some user options that could be reset to make that warning go away. It does not make any sense.

 

[Mztk1]

What you are seeing is very common in my market right now. The prices have been reduced a lot and buyers/investors are now moving in buying up the deals. The houses priced low are selling quickly resulting in dropping values and shorter marketing times. If you price your house too high, it just won't sell.

 

[LordofTexas]

Frenzied Sellers/Savy Buyers?

What you are seeing is very common in my market right now. The prices have been reduced a lot and buyers/investors are now moving in buying up the deals. The houses priced low are selling quickly resulting in dropping values and shorter marketing times. If you price your house too high, it just won't sell.

I agree with Jim. You have an influx of buyers realizing and quickly acting on these somewhat "good" deals created by sellers in a current frenzy to beat the decline thereby lowering the overall values creating a "new" area market value range. I would just word something to this affect in your addendum for this section. Does that make sense?

 

[Lax1]

Your comps show under 90 days but what it the overall market showing for all properties in your defined neighborhood. I assume your 3 comparables are not the total market of this neighborhood. If your particular subject in the neighborhood is under 90 days but the overall neighborhood is 3-6 months just check 3-6 months and then explain the market for your home is less than 90 days. Again checking the cumlative days on the market for the sales as well as days on the market for pendings and actives similar to your subject.

 

[Liz Mura]

George, I have noticed the same thing recently in Phoenix. I just gave them the statistics to show the declining market and they could see the comps all selling at less then 3 months total time.

 

[c w d]

I don't understand the confusion about <90 days exposure and declining markets. If you want your home to sell quickly you will price it to attract buyers: i.e. less than the competition. The short exposure time and declining values are perfectly reasonable. If you graphed the sales in relation to their DOM you may see a trend where shorter DOM equates to lower value sales, higher DOM equates to higher value sales and then at some point in your market there is diminishing return.

And, lets not forget the media's roll. They're blurbing the possibility that we've hit bottom from time to time even in light of their reports indicating still continuing sharp declines. *shrugs*

 

[444nutman]

I had one about 6 months ago that was in decline but less than 6 months and market was in balance. I had to call two of my local peers and have them look at the market to make sure I was right. They agreed. It is what it is and doesnt always agree with the book.

 

[Riick]

Doing one right now.
Raw # of sales down by 42% from same period last year.
Average Days on market for Sales is 62 days.
Average Days on market for Actives is 192 days.

MLS published statistics for Q1-2008 blithely says market is Stable. Right.
BTW... The MLS statistics are developed for them by NAR national.